SEC regulation on fund disclosures won't require that every fund hire a compliance officer. It just requires that the funds files the necessary disclosure documents, like audited year-end statements, virtually 80% of the funds will just hire a third-party to do the filings, not a big deal. I think that almost all hedge fund administrators will offer this service come 2006. The cost will be 20-50k, similar to a set of year-end audit.
Also, this fund have 2 partners, then 3 staff, plus a secretary, and fifth ave address. This is pretty far from the norm. Let me give you a couple of comparable situations. I was a part of a $100M fund, then grew to $220, the fund was 2 partners, me (trading, risk, technology, broker interface), and 1 analyst (hired after me, who helps me out in the back-office stuff after trading hours). When we hit 220, we hired one more helper for me, and 1 more junior analyst, that's it. So all together 6 people (no secretary) to run $220M. We had a Park Ave address, rented the space from a Prime Broker, and we were paying about $14k a month in rent. This covers secretarial support (someone that answers the switch board, as "XYZ capital partners"), technology support and office supplies.
A small story to show how cheap some wealthy people can be. I flew to Monterrey for a hedge fund conference once, a fund manager I know wanted to go together (sharing a rental car, etc, etc). Okay, no problem, when we were buying the plane tickets, this guy pulls out a "two-for-one" companion fare coupon for ATA airlines (imagine my eyes)! And wanted to stay at a Red Roof Inn (!!) 40 miles away. It is hilarious that we were spend the day in our suits with wealthy potential investors, then drive 40 miles back to our Red Roof Inn rooms. And when I mentioned to a mutual friend, he said, "do you know how much money he has?" "err, no, not really" "He has a Park ave south apt, next door to Henry Kissinger!" I was *floored*. I mean, this guy, whose *apartment* is worth > $5M, flies ATA and stays at Red Roof Inn. Of course it goes without saying that if we were not with clients, we were eating ... you gussed it ... McDonalds.
Also, this fund have 2 partners, then 3 staff, plus a secretary, and fifth ave address. This is pretty far from the norm. Let me give you a couple of comparable situations. I was a part of a $100M fund, then grew to $220, the fund was 2 partners, me (trading, risk, technology, broker interface), and 1 analyst (hired after me, who helps me out in the back-office stuff after trading hours). When we hit 220, we hired one more helper for me, and 1 more junior analyst, that's it. So all together 6 people (no secretary) to run $220M. We had a Park Ave address, rented the space from a Prime Broker, and we were paying about $14k a month in rent. This covers secretarial support (someone that answers the switch board, as "XYZ capital partners"), technology support and office supplies.
A small story to show how cheap some wealthy people can be. I flew to Monterrey for a hedge fund conference once, a fund manager I know wanted to go together (sharing a rental car, etc, etc). Okay, no problem, when we were buying the plane tickets, this guy pulls out a "two-for-one" companion fare coupon for ATA airlines (imagine my eyes)! And wanted to stay at a Red Roof Inn (!!) 40 miles away. It is hilarious that we were spend the day in our suits with wealthy potential investors, then drive 40 miles back to our Red Roof Inn rooms. And when I mentioned to a mutual friend, he said, "do you know how much money he has?" "err, no, not really" "He has a Park ave south apt, next door to Henry Kissinger!" I was *floored*. I mean, this guy, whose *apartment* is worth > $5M, flies ATA and stays at Red Roof Inn. Of course it goes without saying that if we were not with clients, we were eating ... you gussed it ... McDonalds.
